More Seniors Consider Reverse Mortgages to Finance Retirement

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Honestly, I sell Reverse Mortgages and I do it with out guilt. Some of the homes I have been in, the seniors cannot afford food or their prescriptions because they are paying their monthly mortgage and they have equity tied up in their home that only their children will benefit from. The reverse allows the homeowner to live in their home without fear of foreclosure, the ability to purchase needed items and more often than not, make needed repairs on the home. Yes the bank profits from the mortgage, but you can't tell me that starving to death is better. The only ones that should have any concern about it are the heirs to the property, and if the heirs care more about how much money they get than mom/dad or the grandparents living comfortably, then shame on them. Even those that are doing okay financially, we can almost always lower their interest rate, make repairs on their home and give them cash to do what they want with, they can make monthly payments on the note just as a conventional mortgage, the only difference is that if they have a bad month, they don't have to make the payment. Last week I had two seniors who were about to be booted out to the streets because they couldn't make their monthly mortgage payment, they had no where else to go, so the reverse saved their home. Now what would have happened even if they could have made their payment, the bank would have gotten the home and they wouldn't have been able to utilize their equity. Reverses are not a bad deal, but you have to have an honest Loan Officer who will explain the ins and outs.

Edward of OK 5:02PM February 12, 2009

Its' amazing that people will pay $400,000 over a 30 year period for a $150,000.00 home ( 30 year fixed 6%) with the possibility of foreclosure constantly hanging over their heads. ( if you don't think so don't pay your mortgage). then say that Reverse Mortgages are costly. I don't know what the numbers are but an alarming number of Seniors are loosing their homes or their golden years are tarnishing. Reverse Mortgages are a tarnish removing and tarnish preventing product. P.S. Why do children think they are owed something from their parents? Haven't they given enough?

LC of NC 10:00AM January 18, 2009

Pardon me, naysayers, but I have seen each of the following take place:
-a senior who uses reverse mortgage proceeds to buy an insurance policy worth twice the value of his house. His beneficiaries will receive that money tax-free, as well as the proceeds from the house when he dies and they sell it. Leverage, not need.
- a couple who used their primary residence to buy a cabin in N. Carolina they use every year to host a family reunion. They will not make a payment on either property. Lifestyle enhancement.
- a gentleman was two weeks from foreclosure although he only owed $35,000 on his $150,000 home. He could no longer make the payments. With a reverse mortgage, his home was saved from foreclosure, he can live there the rest of his life without making a single payment, and he got another $40,000 to use as he sees fit. Saved his home.
Cost too much? I think not. Nothing is good when used inappropriately. Go blame the Wall Street bankers and stock brokers who greedily bought sub-prime loans and lost folks half their retirement savings. Now people are turning to their last remaining asset, their home.

JB of FL 9:30AM December 15, 2008

I guess it's a bad idea putting a senior into a reverse mortgage!
Better idea would be to let them take out a credit line mortgage or use a credit card when we need money. I am more than sure even if iam late I will not pay more than 33% inrest that is if I qulaify for a credit card or mortgage loan at 6%n. And if i can't make my mortgage payments I am more than sure they will not foreclose on me. Or maybe President elect Obama will make my payments for me. I am sure that my heirs will gladly pay my debts for me so I don't have to worry that I can't pay my bills. and they will vist me every day as I live in another state. and if I can take out more money than my home is worth or that i borrowed more, my bank or my familly will go into their pockets and send me a check so I can buy fancy cars and eat in expensive resturants and will send me on cruises. Since I worked hard all my life and never asked my children for any money or help and wisley invested in my home I should be happy to give it to my children so they can spend the money any way they want. Never mind I could be independent and might enjoy my remaining years with my friends and neighbors.
Or I can be independent and take a reverse mortgage and enjoy my life!

Larry Batch of FL 10:06AM December 14, 2008

The satisfaction rate for clients is over 90%
The only thing missing is more education so seniors understood how powerful a tool it can be.
I am Reverse Mortgage specialist , and have never been more proud of any industry or product that I have sold.
They are not for everyone, but dont be so hard on Pat B!

STEVEN RACHER of FL 7:37AM December 13, 2008

I think you should learn more about the reverse mortgage program before you start passing along bad info. I do agree there are bad apples out there that explain the credit line as an interest baring account when in reality the growth rate is just allowing access to more equity over time. You are going to have bad apples in any sales field. "Fees" as you call it, are def high, there is no disagreement there. Paying money to the goverment to insure the loan is non recourse is not a fee. You are paying for protection, and not passing on a burden to a family member in the case the senior goes upside down. THIS IS NOT PAID TO THE MORTGAGE COMPANY You say the worst thing is that air to the house has a year to sell? If it were a traditional mortgage they would have to start looking into selling the home immediately, and start racking up fees if they could not pay, and even worse be in foreclosure within 3 months. The bank doesnt take their home, or foreclose on it. They help sell it, and if they are upside down the government will even put 7% towards realtor fees.
You sound like a bitter kid who was banking on their parents home for themselves. I think most people would rather see their parents living comfortably, and leave them less. Rather then struggle and leave them everything. They worked hard their whole lives, and THEY shoule see the fruit of their labor. Not their children.
**LAST BUT NOT LEAST**
ALL SENIORS MUST COMPLETE A COUNSELING SESSION WHICH IS DONE BY A 3RD PARTY NON PROFIT AGENCY. THE COUNSELOR THEN EXPLAINS THE PROGRAM IN ITS ENTIRITY, AND MAKES SURE THE MORTGAGE BROKER HAS NOT LEFT ANYTHING OUT. IF THE SENIOR DOES NOT COMPLETE COUNSELING SESSION, YOU CANNOT MOVE FORWARD.
THIS PROGRAM IS EXPENSIVE, AND DOES NOT MAKE SENSE IF THE SENIOR PLANS ON MOVING A SHORT TIME AFTER THE REVERSE MORTGAGE.

Ricky Y of NY 11:13AM December 12, 2008

REVERSE MORTGAGES ARE A BIG RIP OFF.
GENERALLY, BORROWERS ARE NOT TOLD THE FULL TRUTH.
FEES ARE HIGH AND THEY WILL TELL YOU THAT YOU EARN INTEREST ON YOU UNUSED LINE OF CREDIT (WITH AN INTEREST RATE HIGHER THAN YOU ARE PAYING ON THE AMOUNT DRAW OUT) THIS IS NOT TRUE.
THE WORST THING IS THAT WHEN THE BORROWER DIES NO ONE TELLS THEM AT THE TIME THEY TAKE THE LOAN OUT, THAT THE PEOPLE THEY LEAVE BEHIND WILL ONLY HAVE (AFTER ALL THE EXTENSIONS, ETC) ONE YEAR TO SELL THE HOME OR THE MORTGAGE COMPANY WILL START FORECLOSURE PROCEEDINGS
I CANNOT BELIEVE THAT ANY ELDERLY PERSON WOULD WORK ALL THIER LIVES FOR THEIR HOME AND KNOWINGLY LOOSE EVERYTHING IF THE LOAN IS NOT PAID IN FULL WITHIN ONE YEAR OF THEIR DEATH.
I UNDERSTAND THEY ARE NO LONGER HERE, BUT GENERALLY I BELIEVE THAT A LOT OF ELDERLY PEOPLE ONLY HAVE THEIR HOMES TO LEAVE TO THEIR LOVE ONES AND IF THEY KNEW THAT WOULD NOT HAPPEN, THEY WOULD NEVER SIGN.
SHAME ON ALL THE CELEBRITIES AND MORTGAGE COMPANIES THAT ARE DOING THIS TO OLDER PEOPLE. THEY ARE NO BETTER THAN THOSE PEOPLE THAT KNOCK ON ELDERLY PEOPLES DOORS AND RIP THEM OFF FOR A MULTITUDE OF SINS.

of PA 10:27AM December 12, 2008

Lenders make money on every loan, not just reverse mortgages. That's why they are in business.

br of FL 4:05PM December 11, 2008

Just another way for them to get to the seniors. I hope an pray we will never get in that situation. s brown, Tenn

SHERMAN M B ROWN of TN 3:17PM December 11, 2008

They are not as advertised. They are very costly to the borrower.
Shame on senior citizen Pat Boone for accepting money for the commercial where he is endorsing them.

HillbillyBill of TN 2:20PM December 11, 2008